LTC has lagged during the pandemic but with much promise, the stock showed resistance throughout the period.
As LTC Properties (LTC) nears the earnings release, the shares are starting to pump—aiming for $40 per share. Currently, LTC stock is trading at $39.29 up by 1.68%.
While the average trading volume of LTC is just under 250K, which means that investors are happy to jump in trading the dividend-based stock. The company has just announced its fourth-quarter results to be released soon, so what’s coming up?
What’s Next?
LTC Properties (LTC) is a US-based real estate investment trust (REIT) that invests in senior housing and health care properties. LTC is a conservatively levered REIT that maintains a comfortable dividend payout, which is paid from cash flows rather than EPS.
The pandemic harmed LTC’s operations, but now with vaccine availability, things are expected to change in the next few months. During the past year, the company maintained fairly comparable FAD, with the drop partially related to lower rents received from Senior Lifestyle.
The CEO of LTC in the Q3 report highlighted that they have recorded continued support from the government. Moreover, they received higher rent from its Senior Lifestyle portfolio compared to prior quarters.
With things getting better now, the company will continue to support its operators. The company has also announced to reduce its rent escalation by 50% in 2021. This escalation will be in the form of a rent credit, providing financial support to its operating partners during these tough times.
This one-time rent escalation reduction would probably have a $560K impact on LTC’s GAAP revenue for Q1 2021. While the funds available for distribution (FAD) would be around $1.4 million. This would create a good reliable relationship between the company and the operators in this crisis. The company wants to support its operators in any manner it can, continuing business operations and maintain cooperation with operators.
Furthermore, LTC has scheduled the fourth quarter 2020 earnings results set to release on Feb. 18, 2021. The next day, the company will hold a conference call to discuss the quarterly outcomes with analysts and investors.
The company has also declared the quarterly dividends that are to be payable on March 31 to its shareholders. LTC has announced a dividend payout of $0.19 for each common stock share, which equals a dividend yield of 5.90% at recent price levels.
Conclusion
LTC Properties (LTC) is trying to cope up with the pandemic situation quite well. As the Q4 earnings release nears, the stock would pop up and down. According to Zacks, in Q1 2021, LTC is expected to report an EPS of $0.71 per share from $0.81 per share year-over-year.
